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Chavez ‘Takes Over’ 60 Oil Service Firms

From his comrades at China’s Xinhua news service:

Venezuela nationalizes 60 oil service companies


CARACAS, May 8 (Xinhua) — The Venezuelan government on Friday started the process to nationalize 60 oil service contractors and place them under the control of the state oil company, Petroleos de Venezuela.

President Hugo Chavez was greeted by workers dressed in red and waving the company’s flags on the Lake of Maracaibo in the oil rich state of Zulia, as he toured the newly expropriated installations.

"We are advancing the construction of socialism," Chavez told state television, as he spoke and shook hands with employees. "The profit will now stay with the workers," he added.

Chavez said the takeover would lead to an "around-20-percent" cut in production cost as a result of better management and improved efficiency.

With the move, 300 boats, several ports and more than 8,000 workers will now be absorbed by the state oil giant, according to Oil Minister Rafael Ramirez, who accompanied Chavez in touring around the facilities.

The expropriations followed the approval of the Organic Law by the National Assembly on Thursday which cleared the way for the nationalization of the service companies in all primary hydrocarbons operations.

The law will affect contractors dealing with water, vapor or gas injection, gas compression, staff and materials transportation, replacement of pipelines and vessel maintenance.

Chavez said that the measure represented a "socialist offensive" which would eliminate the monopoly of the contracting companies and guarantee the welfare of thousands of Venezuelan workers.

Venezuela, which relies on oil income for over 93 percent of its export earnings, has been greatly affected by the rapid decline in oil prices.

Petroleos de Venezuela has recently begun seeking for [sic] previously unsolicited foreign investment in the oil rich Orinoco Belt as well as renegotiation of current contracts with some foreign companies to reduce costs.

Following the victory in a February referendum which will allow him to run for president again when his term expires in 2012, Chavez has pushed forward a series of similar reforms.

In March, the government nationalized several rice factories apart from taking over some key ports previously run by state governments to bring them under the control of national government.

In 2007, Chavez nationalized oil projects worth billions of dollars, leading oil giants Exxon Mobil and Conoco Phillips to quit the nation and sue for compensation.

Thank God this kind of naked socialism can’t happen here.

This article was posted by Steve on Saturday, May 9th, 2009. Comments are currently closed.

14 Responses to “Chavez ‘Takes Over’ 60 Oil Service Firms”

  1. proreason says:

    He’s jealous of The Moron.

  2. Gila Monster says:

    “Chavez said that the measure represented a “socialist offensive” which would eliminate the monopoly of the contracting companies and guarantee the welfare of thousands of Venezuelan workers.”

    So, El Jefe’ is taking over 60 separate oil service companies and absorbing them into his single nationalized oil company, and this is considered the “elimination of a monopoly”?
    Just words, I suppose, but isn’t irony ironic?

    It appears Hugo has certainly attended a seminar at the world renowned Obama Institute of Political Brainwashing, heh.

  3. Rusty Shackleford says:

    Clearly, those 60 companies were “too big to fail”.

  4. Petronius says:

    “Thank God this kind of naked socialism can’t happen here.”

    A profound change in the investment climate is already underway here. The cost of capital to American companies is being driven up as investors and lenders are beginning to require a “political risk” premium on the stocks and bonds of U.S. corporations. Heretofore a political risk factor was found on securities in emerging markets, in countries such as Russia, China, Malaysia, South Africa, Pakistan, Turkey, or parts of Latin America, countries with uncertain economic policies and unsound currencies, countries where the rules are in flux, where promises are not kept and contracts are not enforced, countries where the railroads don’t run on time.

    The emergence of this political risk premium in American markets is something new. It is a result of arbitrary and capricious presidential action––because The Bama and his gang of Bolshevik thugs act with the expediency of criminals. Already in the first 100 days we have seen: legislation enacting massive wealth transfers to favored constituencies, colossal deficit spending that will drive inflation, sacking GM’s CEO, attacks on bondholders of Chrysler and GM and transfer of ownership to the UAW, calls for attacks on AIG executives and confiscation of their property, threatening bankers and executives of credit card companies at a White House meeting, going after foreign subsidiaries of American companies and foreign bank accounts of wealthy individuals, attacks on hedge fund managers, calls for higher taxes on dividends and capital gains, proposed legislation to use the bankruptcy courts to waive mortgage payments, threatening banks to make more sub-prime loans, tax cheats appointed to Treasury and other high offices, and refusal to allow banks to repay TARP loans.

    Some radical assault on the economic order, some new anti-business and anti-investor program or policy, now occurs daily in the U.S. All of this spells an end to American prosperity.


    • proreason says:

      “The emergence of this political risk premium in American markets is something new”

      It’s a good point, but it isn’t new.

      A similar thing happened in the 30’s, and the markets were erratic, dangerous, and low for 15 years, until capitalism came back after WWII.

      That’s why the current market is a sucker’s rally.

      Someone needs to explain to me how American businesses will make good profits when, willy nilly, the Moron can decide to punish this business he hates over here, and re-distribute the money to his pet constituencies over there.

      Of course, back then, FDR wasn’t trying to punish anybody; he just was a Socialist and probably geniunely thought his brainfart of the moment was going to fix everything.

      In our case, we have an evil ganster cabal stealing from the producers and giving it to the deadbeats….who have more votes…….why?……….for power….no different than Hugo Chavez.

      Even Michael Barone, no blogger flack, says it: http://www.ibdeditorials.com/IBDArticles.aspx?id=326589766764151

    • Petronius says:

      Pro, your comment bears repeating: “an evil gangster cabal stealing from the producers and giving it to the deadbeats…who have more votes…..why? …….for power”

      Amen. Their goals are power and plunder. Their methods are lies, fraud, force, and extortion. The result is destruction. After they’re done with the banks, insurance companies, and autos, they’ll move on to the medical companies, Big Pharma, Big Oil, and utilities. Barone’s article is powerful. Such an arrogant evil. Adjutorium nostrum, Domine.

  5. 12 Gauge Rage says:

    Notice how there is silence on Capitol Hill on Chavez’s latest power grab. After all, one can’t criticize another when they have the same thing in mind all along.

  6. VMAN says:

    I wonder which head of these companies won the lottery to be commissar over all these companies. The dirty little secret is that these big business types don’t hate socialism as long as they can be in charge. The heads of these multinational companies don’t mind playing along with the socialists as demonstrated by their political donations.

    • proreason says:

      VMAN: “dirty little secret is that these big business types don’t hate socialism as long as they can be in charge.”

      It’a an interesting observation, and I tend to agree with it, but I also think it leads to the invalid conclusion that business can do just as well under socialism as under capitalism.

      The reason is that the true strength of free markets (capitalism) is competition. Whether business leaders are geniuses, idiots, flacks, or philosophers is irrelevent. If the market is free, the public will eventually speak and businesses that don’t produce useful products will fail and businesses that do produce useful products for fair prices will succeed.

      In socialism, the goverment decides what businesses succeed or fail. And unless you are one of the substantial number of lunatics who somehow think that a person with no experience and no wisdom can decide who will win and lose in the most complex economy of all time…..because, I guess, he wears clothes well and has a sonorous baritone voice…then socialism is destined to fail.

      As it has done, every time it has been tried.

  7. LewWaters says:

    And what do they do once all those profits begin drying up? Did they consider profits going to update, research or developement? I doubt it, just put some small redistributed wealth temporarily in the pockets of the deluded proletariat.

    It seems many of those same wealthy who supported Obama are beginning to open their eyes.


    Whether or not it’s too late to prevent acts like Chavez’s in America remains to be seen.

    • proreason says:

      Curious, isn’t it Lew, that you can only read articles like that from foreign sources.

      It’s almost as if our watchdog media isn’t just not reporting the news, it’s almost as if they are actively suppressing the news they don’t want the country to hear.

      But we sure know a lot about the puppy, the dijon mustard, the sneakers, and the toned arms, don’t we?

  8. Liberals Demise says:

    Looks like one criminal showing the other criminal who has more power than who.

    • TwilightZoned says:

      Geez…I believe in competition as much as the next capitalist, but Yougo Chuvit and Obamy Oblabla competing is just crazy talk! (full blown sarcasm)

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